Ambani peace fires up Sensex

Sensex cracks 7,000, Reliance companies surge to record highs.

Spurred by the surge in Reliance shares, the Sensex today went above the magic figure of 7,000 for the first time before closing at 6,984.55, a new high.

The total market capitalisation of BSE stocks went up by Rs 17,000 crore to Rs 18,11,000 crore.

Shares of Reliance Industries, the Sensex's second-biggest constituent, jumped 7.5 per cent to a record Rs 645.70 and Indian Petrochemicals Co Ltd rose 7 per cent to Rs 167.60. Both the companies are now controlled by Mukesh Ambani.

The share price of Anil Ambani-controlled firms notched an even higher growth. Reliance Energy surged 19 per cent to Rs 705.90 and Reliance Capital rose 30 per cent to Rs 308.

Some analysts, however, noted the risks of rising oil prices and what has so far been a patchy monsoon. Nimesh Kampani, chairman and managing director, JM Morgan Stanley, said the Sensex might see a correction of 200 points.

The impact of the Reliance group stocks on the Sensex rise is evident from the fact that the breadth of the market was negative with 633 stocks advancing against 1,869 stocks declining.

Among the 30-share BSE basket stocks, 15 stocks ended positive, while 15 lost.

Volumes were moderate and accounted for Rs 3,225.56 crore on the BSE and Rs 6,724.59 crore on the NSE. The Nifty ended 20.95 points higher to close at 2,144.35.

Frenzied buying in the Reliance group shares saw the market turnover in these companies accounting for 49.25 per cent of the total BSE and the NSE trade.

Reliance Industries topped the turnover chart, both on the NSE and the BSE, with Rs 2,144 crore worth of trade and 33.92 million shares changing hands.

Reliance Capital posted a turnover of Rs 1,480 crore, Reliance Energy Rs 937 crore and IPCL Rs 339 crore.

BSE broker Ramesh Damani said, "Today's all-time high is a good psychological boost for the market. The Sensex may sustain at higher levels as liquidity is shifting from mid-cap to large-cap stocks."

Among the other Sensex gainers, the Hindalco scrip was up by 4.33 per cent to close at Rs 1185.65, Infosys rose 3.79 per cent to Rs 2375.50 and Satyam Computer was up 3.49 per cent at Rs 503.50.

The market today witnessed shifting of liquidity from mid-caps to large caps with the BSE Mid Cap index losing 0.42 per cent in today's trading.

Profit booking was witnessed in stocks like ICICI Bank, which lost 2.67 per cent at Rs 405.10. The Tata Power scrip lost 2.01 per cent to close at Rs 366.30, the SBI was down 1.62 per cent to Rs 656.55 and the Tata Motors was down 1.51 per cent to Rs 414.15.

Among the indices, the consumer durables index was down by 2.34 per cent losing 46.54 points, the Bankex was down 1.64 per cent losing 64.82 points and the BSE small-cap index went down 1.29 per cent losing 56.62 points.

However, investors bought oil and gas and technology sector stocks.